I don't know how much of Ireland debt matures in the next 12 months, but it may be more than the balance of trade surplus. Also I don't know how directly a balance of trade surplus translates into Government cash flow to pay off maturing debt.

Doesn't really matter, as long as the Irish government is able to tell the largest single creditor to fuck off. Its creditors are unlikely to form a coherent block if it starts taking them down one by one.

So unless you are advocating defaulting on currently maturing Government debt - much of which probably predates the banking crisis and was thus lent in good faith to a Government with a c. 25% debt/GDP ratio - this is debt which should be repaid.

And it will be... if they keep rolling it over until the bad bank debt has been resolved. The alternative is to simply default on all Irish sovereign debt and set up a shadow central bank to fund the deficit. That would be far worse for these creditors.

- Jake

Friends come and go. Enemies accumulate.